Circular No.: IBBI/CIRP/38/2021
By EDITORIAL TEAM - INSOL India Posted On : January 06, 2021
A circular dated 6th January 2021 (“Circular”) was issued by Insolvency and Bankruptcy Board of India (IBBI) to all the registered and recognized insolvency professionals (“IP”), entities and agencies. The circular was regarding the maintenance of several records in relation to the assignments conducted by them under the Code owing to the importance conveyed by the IBBI for records.
The Circular reiterates that Regulation 3 of the IBBI (Inspection and Investigation) Regulations, 2017 empowers the Board to conduct inspections and ensure that records are being maintained by an IP in the manner required by the relevant regulations. Regulations 4 and 8 of the aforementioned regulations also empower the inspecting authority / investigating authority to direct submission of records by the IP.
The Board has directed retention of records under Regulation 39A of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2017 (“CIRP Regulations”):
(i) An IP shall preserve:
a) An electronic copy of all records (physical and electronic) for a minimum period of eight years; and
b) A physical copy of records for minimum period of three years from the date of completion of the corporate insolvency resolution process (“CIRP”) or the conclusion of any proceeding relating to the CIRP before the Board, the Adjudicating Authority (“AA”), Appellate Authority or any Court, whichever is later.
(ii) An IP shall preserve records relating to that period of the CIRP when he acted as the interim resolution professional or the resolution professional, irrespective of the fact that he did not take up the assignment from its commencement or continue the assignment till its conclusion. For example, an IP who served for three months as a resolution professional before he was replaced by another IP, who served as the resolution professional till the conclusion of the CIRP is required to preserve records relating to the first three months while the IP who served as the resolution professional till the conclusion of the CIRP is required to preserve records relating to the period of the CIRP from when they took over.
(iii) An IP is required preserve copies of records relating to or forming the basis of certain documents including, inter alia, those in relation to their appointment as the interim resolution professional or resolution professional, any handing over or taking over by them, admissions of the corporate debtor into CIRP, public announcements, constitution of the committee of creditors, verification of claims, information memorandum, filings with the AA etc as more particularly set out in the Circular.
%u200B(iv) An IP shall preserve the records at a secure place and ensure that unauthorized persons do not have access to the same. For example, they may store copies of records in electronic form with an Information Utility. Notwithstanding the place and manner of storage, the IP shall be obliged to produce records as may be required under the Insolvency and Bankruptcy Code 2016 (the “Code” or “IBC”), the CIRP Regulations and any other applicable regulations.
The Circular reiterates that Regulation 3 of the IBBI (Inspection and Investigation) Regulations, 2017 empowers the Board to conduct inspections and ensure that records are being maintained by an IP in the manner required by the relevant regulations. Regulations 4 and 8 of the aforementioned regulations also empower the inspecting authority / investigating authority to direct submission of records by the IP.
The Board has directed retention of records under Regulation 39A of the IBBI (Insolvency Resolution Process for Corporate Persons) Regulations, 2017 (“CIRP Regulations”):
(i) An IP shall preserve:
a) An electronic copy of all records (physical and electronic) for a minimum period of eight years; and
b) A physical copy of records for minimum period of three years from the date of completion of the corporate insolvency resolution process (“CIRP”) or the conclusion of any proceeding relating to the CIRP before the Board, the Adjudicating Authority (“AA”), Appellate Authority or any Court, whichever is later.
(ii) An IP shall preserve records relating to that period of the CIRP when he acted as the interim resolution professional or the resolution professional, irrespective of the fact that he did not take up the assignment from its commencement or continue the assignment till its conclusion. For example, an IP who served for three months as a resolution professional before he was replaced by another IP, who served as the resolution professional till the conclusion of the CIRP is required to preserve records relating to the first three months while the IP who served as the resolution professional till the conclusion of the CIRP is required to preserve records relating to the period of the CIRP from when they took over.
(iii) An IP is required preserve copies of records relating to or forming the basis of certain documents including, inter alia, those in relation to their appointment as the interim resolution professional or resolution professional, any handing over or taking over by them, admissions of the corporate debtor into CIRP, public announcements, constitution of the committee of creditors, verification of claims, information memorandum, filings with the AA etc as more particularly set out in the Circular.
%u200B(iv) An IP shall preserve the records at a secure place and ensure that unauthorized persons do not have access to the same. For example, they may store copies of records in electronic form with an Information Utility. Notwithstanding the place and manner of storage, the IP shall be obliged to produce records as may be required under the Insolvency and Bankruptcy Code 2016 (the “Code” or “IBC”), the CIRP Regulations and any other applicable regulations.